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A Growth Industry: How Ecovative Design’s mushroom-based products are transforming the packaging industry and proving the power of impact inventing

January 21, 2015

Making packaging materials out of living organisms sounds like a far-fetched idea, but to hear Eben Bayer tell the story, it’s the most natural thing in the world.

Bayer is CEO and co-founder of Ecovative Design, a materials science company that is developing a new class of home-compostable biomaterials made largely from mushrooms. Ecovative is using mycelium, the vegetative growth stage of the fungi – essentially a living polymer – to make environmentally responsible alternatives to traditional foam packaging, insulation, and other plastic-based materials.

The process is as fascinating as it is unexpected. Ecovative grows the mycelium in agricultural waste material; not manure or food, but stalks, husks, and the like. When the mycelium mature they can be molded into virtually any shape. They might be protecting your electronics or a bottle of wine during shipping. Or they might be turned into auto parts. There are now even surfboards made from mushrooms.

Bayer, who grew up on a farm in Vermont, said the idea was born at the intersection of his agricultural background and his study of mechanical engineering at Rensselaer Polytechnic Institute, where he earned a dual degree in mechanical engineering and innovation design. It was while Bayer was at Rensselaer in 2007 that Lemelson Foundation grantee VentureWell helped him and classmate and co-founder Gavin McIntyre in a couple of different ways to turn the idea into a viable business.

The first was in a course called Inventor’s Studio, taught by Professor Burt Swersey and funded by VentureWell. Swersey aims to create a culture of innovation through the class, and to help students learn to see opportunities. It worked with Bayer and McIntyre.

“It was a really special course,” Bayer said, noting that the goal of the class was for students to come out of it with marketable inventions that can be profitable, patentable, and that change the world for the better.

They got that and much more. VentureWell also provided mentoring for them, and, eventually, a grant for $14,000.

“That gave Gavin and I just enough resources to incorporate a business,” Bayer explained. It was key support at a pivotal time in Ecovative’s early development as a business, a stage when investors are often leery about signing on with a new company that has yet to prove itself. VentureWell’s grant clearly paid off. In the years since, Ecovative has raised over $14 million in equity financing from new and existing investors and generated millions in annual revenue.

Ecovative By The Numbers

1: First company to commercialize renewable materials made from fungi

3: Commercial products currently in production

10: Named by Fast Company as one of the world’s top ten most innovative companies dedicated to social good

30: Co-founders Bayer and McIntyre named to Forbes “30 Under 30” list

70: Green collar jobs created

~$5.5 million:Awarded grant money to date

~$22 million: Investment raised by the company to date

Hundreds of thousands: Plastic foam packaging parts replaced

Bayer does not downplay the importance of that first, comparatively small grant, however. “It is easier for us to raise a million dollars now than it was to raise a thousand back then,” he marvels.

Once they got going, Ecovative attracted a lot of attention, and funding, through grants, business plan competitions, and the like. They’ve also received support from key partners, including the New York State Energy Research and Development Authority, the National Science Foundation, the U.S. Department of Agriculture, and the Environmental Protection Agency. The company has won awards for sustainability and green technologies. It was named a Tech Pioneer at the 2011 World Economic Forum in Davos, Switzerland, was the 2013 winner of the Buckminster Fuller Challenge, and received the Cradle to Cradle Products Innovation Prize.

As Ecovative’s business has grown it has become a living model for what The Lemelson Foundation refers to as Impact Inventing. The business has positive social impact, helping to create jobs and establish an economy for renewable material. It is environmentally responsible, producing sustainable alternatives to plastics and plastic foams while continuing to perform life-cycle analysis internally to help guide their manufacturing process development and implementation. Meanwhile the company has become financially self-sustaining, with products in use in the packaging, furniture, and consumer goods industries.

Bayer explains: “We want to create better materials, but more than that, it’s about protecting our planet. At the end of their life, these products are totally biocompatible. We’re giving customers a nutrient, not a pollutant, for their neighborhoods.”

Exactly how much better is hard to say. Ecovative’s goal is to have an energy and environmental footprint that is not just a little better, but far better, than that of conventional materials. They have yet to publish a peer reviewed Life Cycle Assessment that would take an objective look at the scale of the difference. They plan to make that happen soon so they can make meaningful scientific comparisons between their products and plastic production.

Bayer appreciates the support for education that encourages invention and innovation. He says many young people share his ethic for sustainability, and they could accomplish great things given the right tools.